Have State Farm’s "Mad Dog" tactics taken a bite out of you?

September 30, 2013by Steven Gursten

Insurance attorney discusses Campbell case, and how State Farm’s “deceit and cheating” make it not the good neighbor you think it is

This week is going to be State Farm week for the Michigan Auto Law blog. Let’s start with the obvious: State Farm Mutual Automobile Insurance Company did not become one of the largest — and the most profitable — auto insurers in the country because of its charm, good looks and comforting bedside manner.

And based upon my own personal experience as an insurance lawyer, it certainly hasn’t been from how it treats its own State Farm customers when they’re injured in automobile accidents either.

State Farm got to where it is because of its willingness to throw very sharp elbows and its ruthless business practices – even when it comes to its own customers.

And I didn’t make up that last point. It was made by the Utah Supreme Court in an opinion called Campbell v. State Farm Mutual Automobile Insurance Company. In Campbell, an at-fault State Farm insured (State Farm customer) sued the company for “bad faith” after State Farm’s unwarranted refusal to settle the exposed insured customer to more than $100,000 in personal liability.

Among the many bombshell revelations that came out during the case, the Utah Supreme Court highlighted the following instances of “reprehensible conduct” and “egregious and malicious behavior” on State Farm’s part:

Fraudulent practices toward minorities, women and the elderly: “State Farm’s fraudulent practices were consistently directed to persons – poor racial or ethnic minorities, women, and elderly individuals – who State Farm believed would be less likely to object or take legal action.”

Keeps no records: “State Farm, as a matter of policy, keeps no corporate records related to lawsuits against it, thus shielding itself from having to disclose information related to the number and scope of bad faith actions in which it has been involved.”

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